McDonald’s: Relocation not tax-based

Stephen Beard Jul 13, 2009
HTML EMBED:
COPY

McDonald’s: Relocation not tax-based

Stephen Beard Jul 13, 2009
HTML EMBED:
COPY

TEXT OF STORY

Bill Radke: Switzerland is known for chocolate, cheese, and now hamburgers. McDonald’s announced over the weekend it’s moving its European headquarters to Switzerland. Analysts say high taxes are driving the fast food giant out of Britain. From London, Stephen Beard has more.

Stephen Beard: McDonalds is the latest large American corporation to join the mini-exodus out of the U.K. Kraft, Proctor & Gamble, Colgate Palmolive and Yahoo have made the move within the last couple of years. They’ve all relocated their European headquarters from London to Geneva.

McDonald’s insists it is not trying to dodge taxes. But many observers say the decision must be tax-related.

Matthew Sinclair is spokesman for the Taxpayers Alliance. He says there’s been a recent change here in the treatment of income from trademarks, patents and franchises. McDonald’s must be worried.

Matthew Sinclair: A lot of their earnings come from intellectual property which is sold to franchisees. And that is facing a particular threat of double taxation if they have their European headquarters in the U.K.

McDonald’s European business is critically important to the company. Its sales are growing here much faster than in the U.S.

In London, this is Stephen Beard for Marketplace.

We’re here to help you navigate this changed world and economy.

Our mission at Marketplace is to raise the economic intelligence of the country. It’s a tough task, but it’s never been more important.

In the past year, we’ve seen record unemployment, stimulus bills, and reddit users influencing the stock market. Marketplace helps you understand it all, will fact-based, approachable, and unbiased reporting.

Generous support from listeners and readers is what powers our nonprofit news—and your donation today will help provide this essential service. For just $5/month, you can sustain independent journalism that keeps you and thousands of others informed.